Industries

January 18, 2017
by Mike Blanchfield and Alexander Panetta, The Canadian Press

OTTAWA—President-elect Donald Trump’s pick for commerce secretary said Wednesday he won’t be “pushed around” by anyone as he signalled a potentially painful road ahead for Canada and Mexico in NAFTA talks with their U.S. neighbour.

The hard talk from billionaire investor Wilbur Ross contrasted sharply with conciliatory statements from the Liberal government about finding common ground with the Trump administration on elevating the middle class in their respective countries.

Ross said the North American Free Trade Agreement (NAFTA) will be among the first orders of business for the new administration, suggesting the review would be far more sweeping than Canada might like.

But Ross’s testimony before the U.S. Senate commerce, science and transportation committee had other more jarring moments, including when he appeared to express satisfaction in the decline in Canada’s dollar and Mexico’s peso.

It left the incoming Trump administration in a position of strength, he said.

“The president has done a wonderful job pre-conditioning the other countries with whom we’ll be negotiating that change is coming,” Ross said.

“The peso didn’t go down 35 per cent by accident. Even the Canadian dollar has gotten somewhat weaker—also not an accident.”

The loonie closed down a full 1.16 cents at 75.42 cents US, pressured by falling crude prices, a strengthening U.S. dollar and comments from the governor of the Bank of Canada that an interest rate cut “remains on the table” if conditions warrant.

Trump’s tough rhetoric is also having an impact, Ross suggested.

“When you start out with the adverse party understanding that he or she is going to have to make concessions, that’s a pretty good background for any negotiation to begin,” Ross said.

“I don’t intend to be pushed around by anyone.”

Ross said it was logical that the first order of business for the new administration would be to tackle NAFTA, and he made it clear he wasn’t interested in tinkering. “I think all aspects of NAFTA will be put onto the table.”

He called himself pro-trade, “but I’m pro-sensible trade. Not pro-trade that is to the disadvantage of the American worker and the American manufacturing community.”

Trump has called NAFTA a “disaster” and has said he would tear it up or renegotiate it.

After Trump won the U.S. election, the Liberal government said Canada would be willing to sit down with the U.S. and talk trade, saying any agreement can be improved.

The federal Liberal government has been working closely with the Trump administration on a variety of issues, including trade, Prime Minister Justin Trudeau said Wednesday in Sherbrooke, Que.

He said “millions of middle-class jobs” in both countries depend on cross-border trade.

Trudeau said he and Trump were elected on different platforms, but share the same “core idea” of protecting the middle class. “We continue to work constructively with the new administration to protect middle-class jobs.”

Trudeau has recruited Liberal MP Andrew Leslie, a retired general, to help boost ties with the incoming U.S. administration, which includes a number of fellow former military commanders getting top jobs under Trump.

Having named trade specialist Chrystia Freeland to be minister of foreign affairs, the prime minister appointed Leslie as her parliamentary secretary for an extra connection to Washington’s retired generals.

Both are headed to Washington for Trump’s inauguration.

“We have a constructive working relationship with the Trump transition team, and discussions are ongoing,” said Freeland’s spokesman Joseph Pickerill.

“We are confident the new administration will see that Canada’s partnership with the U.S. mutually strengthens our two nations and provides real opportunities to grow our respective economies for the middle class.”

Leslie will have special responsibilities for the Canada-U.S. relationship. Currently the chief government whip, he developed close ties with senior American generals during his time in the military, including as a commander in Afghanistan, capping 35 years in the Canadian Forces.

In 2007, he was awarded the U.S. Legion of Merit in recognition of his work with the American military.

Trump’s cabinet picks include two retired marine generals in key jobs: James Mattis at defence and John Kelly in homeland security. His national security adviser is retired army general Michael Flynn.

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